Question

At the beginning of 2016, Robotics Inc. acquired a manufacturing facility for $13.3 million. $10.3 million...

At the beginning of 2016, Robotics Inc. acquired a manufacturing facility for $13.3 million. $10.3 million of the purchase price was allocated to the building. Depreciation for 2016 and 2017 was calculated using the straight-line method, a 25-year useful life, and a $2.3 million residual value. In 2018, the estimates of useful life and residual value were changed to 20 total years and $630,000, respectively.

What is depreciation on the building for 2018? (Round answer to the nearest whole dollar.)

***I keep getting $451,500 and the system tells me I am wrong. Please help!!***

Homework Answers

Answer #1

Depreciation Expense on the building for 2018

Straight Line Depreciation

Straight Line Depreciation = [Cost – Salvage Value] / Useful Life

= [$103,00,000 – 23,00,000] / 25 Years

= $80,00,000 / 25 Years

= $320,000 per year

Accumulated Depreciation for the year ended 2018 = $640,000 [$320,000 x 2 years]

Book Value at the point of revision = Cost – Accumulated Depreciation

= $103,00,000 – 640,000

= $96,60,000

Book Value at the point of revision = $96,60,000

Revised Salvage Value = $630,000

Years of life remaining = 18 Years [20 years – 2 years already provided]

Therefore, The Depreciation Expense on the building for 2018 = [Remaining Depreciable cost – Revised salvage value] / Remining useful life

= [$96,60,000 – 630,000] / 18 Years

= $90,30,000 / 18 years

= $5,01,667

“Hence, The Depreciation Expense on the building for 2018 = $5,01,667”

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
At the beginning of 2016, Robotics Inc. acquired a manufacturing facility for $13.7 million. $10.7 million...
At the beginning of 2016, Robotics Inc. acquired a manufacturing facility for $13.7 million. $10.7 million of the purchase price was allocated to the building. Depreciation for 2016 and 2017 was calculated using the straight-line method, a 20-year useful life, and a $2.7 million residual value. Assume that 2016 depreciation was incorrectly recorded as $40,000. This error was discovered in 2018. How should Robotics account for the error? What is depreciation on the building for 2018 assuming no change in...
At the beginning of 2016, Robotics Inc. acquired a manufacturing facility for $12.1 million. $9.1 million...
At the beginning of 2016, Robotics Inc. acquired a manufacturing facility for $12.1 million. $9.1 million of the purchase price was allocated to the building. Depreciation for 2016 and 2017 was calculated using the straight-line method, a 20-year useful life, and a $1.1 million residual value. In 2018, the company switched to the double-declining-balance depreciation method. What is depreciation on the building for 2018? (Do not round intermediate calculations. Round answer to the nearest whole dollar.)
At the beginning of 2019, Robotics Inc. acquired a manufacturing facility for $13.0 million. $10.0 million...
At the beginning of 2019, Robotics Inc. acquired a manufacturing facility for $13.0 million. $10.0 million of the purchase price was allocated to the building. Depreciation for 2019 and 2020 was calculated using the straight-line method, a 20-year useful life, and a $2.0 million residual value. In 2021, the estimates of useful life and residual value were changed to 15 total years and $600,000, respectively. What is depreciation on the building for 2021?
In 2016, Alliant Corporation acquired Centerpoint Inc. for $339 million, of which $59 million was allocated...
In 2016, Alliant Corporation acquired Centerpoint Inc. for $339 million, of which $59 million was allocated to goodwill. At the end of 2018, management has provided the following information for a required goodwill impairment test: Fair value of Centerpoint, Inc. $ 247 million Fair value of Centerpoint’s net assets (excluding goodwill) 221 million Book value of Centerpoint’s net assets (including goodwill) 280 million Required: 1. Determine the amount of the impairment loss. 2. Determine the amount of the impairment loss...
2.   In 2010, Alto, Inc., had acquired Rastiline Co. and recorded goodwill of $245 million as...
2.   In 2010, Alto, Inc., had acquired Rastiline Co. and recorded goodwill of $245 million as a result. The net assets (including goodwill) from Alto's acquisition of Rastiline Co. had a 2011 year-end book value of $580 million. Alto assessed the fair value of Rastiline at this date to be $700 million, while the fair value of all of Rastiline's identifiable tangible and intangible assets (excluding goodwill) was $550 million. The amount of the impairment loss that Alto would record...
Happy Mart Sdn Bhd acquired an equipment in Year 2016 for RM100,000 and depreciates it on...
Happy Mart Sdn Bhd acquired an equipment in Year 2016 for RM100,000 and depreciates it on a straight-line basis over its expected useful life of five years. The equipment has no residual value. For tax purposes, the equipment is depreciated at 25% per annum on a straight-line basis. Tax losses may be carried back against taxable profit of the previous five years. In year 2015, the entity's taxable profit was RM25,000. The tax rate is 20%. Required:- Assuming nil profits/losses...
1)On January 1, 2016, Shoreham, Inc. acquired an equipment for $45,600. The estimated life of the...
1)On January 1, 2016, Shoreham, Inc. acquired an equipment for $45,600. The estimated life of the equipment is 6 years, with an estimated residual value of $2,400. In its financial statements, Shoreham uses straight-line depreciation. The book value of the equipment at December 31, 2017, will be: $42,000 $26,600 $36,000 $31,200 2)Sayville Dairy sold a delivery truck for cash of $8,680. The original cost of the truck was $33,600, and a loss of $5,320 was recognized on the sale. The...
Williams-Santana, Inc., is a manufacturer of high-tech industrial parts that was started in 2006 by two...
Williams-Santana, Inc., is a manufacturer of high-tech industrial parts that was started in 2006 by two talented engineers with little business training. In 2018, the company was acquired by one of its major customers. As part of an internal audit, the following facts were discovered. The audit occurred during 2018 before any adjusting entries or closing entries were prepared. A five-year casualty insurance policy was purchased at the beginning of 2016 for $32,500. The full amount was debited to insurance...
Williams-Santana, Inc., is a manufacturer of high-tech industrial parts that was started in 2006 by two...
Williams-Santana, Inc., is a manufacturer of high-tech industrial parts that was started in 2006 by two talented engineers with little business training. In 2018, the company was acquired by one of its major customers. As part of an internal audit, the following facts were discovered. The audit occurred during 2018 before any adjusting entries or closing entries were prepared. A five-year casualty insurance policy was purchased at the beginning of 2016 for $35,000. The full amount was debited to insurance...
Tintin Ltd acquired a mining property in Victoria, called Herge for $18.3 million on 1 July...
Tintin Ltd acquired a mining property in Victoria, called Herge for $18.3 million on 1 July 2016 and treated it as an area of interest. Tintin Ltd incurred the costs as below: Year Details $ Amount August 2016 Right to explore 500,000 2016 - 2017 Exploratory study and drilling 4,500,000 At the beginning of 2018, the technical feasibility and commercial viability of mining the diamond deposit were confirmed. The company’s experts estimated there were 20 million carats of diamonds that...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT